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Bangladesh signs diesel, jet deal with Kuwait

Dhaka, April 13, 2011

Bangladesh has renewed a term oil products supply deal with Kuwait for diesel and jet, the chairman of its state oil company said on Wednesday.

Bangladesh Petroleum Corporation (BPC) will import 1.2 million tonnes of oil products annually from Kuwait Petroleum Corporation (KPC), Mohammad Muqtadir Ali told Reuters.

He said that under an agreement already signed, KPC would supply 1.0 million tonnes of diesel and the rest would be jet fuel.

The two-year agreement, which will expire in December 2012, replaces a similar deal to buy 1.0 million tonnes a year that expired in December.

KPC is a regular supplier to Bangladesh, providing one-fourth of its total demand for diesel and all its jet fuel.

Bangladesh's fuel oil imports will rise by 28 per cent to estimated at nearly 5.0 million tonnes this year because of higher domestic demand, the BPC chairman said.

Besides KPC, he said Bangladesh has also signed deals to import fuel oil from Petco of Malaysia, Middle East Oil Refinery Egypt, Petrochina International Singapore, Maldives National Oil Company and PT Bumi Siak Pusako of Indonesia.

BPC is the only oil importer and distributor in the country.

"HSBC, Standard Chartered Bank and Citi Bank have offered $250 million syndicated loan to the BPC," an official of the energy division said.

The rate of interest of the loan will be similar to that of Jeddah-based Islamic Development Bank (IDB), the official told Reuters.

Bangladesh recently received a loan from the IDB for buying oil with an interest rate of more than 5.0 per cent.

The government has already provided $208 million to the BPC as subsidy to cope with loses it incured due to price difference between importing and selling. – Reuters




Tags: Bangladesh | Dhaka | Kuwait Petroleum Corporation | diesel | Jet |

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